Bank earnings may have reached a low last year as proprietary trading and investment bank activity slows. JP Morgan (NYSE: JPM) CEO Jamie Dimon said the problem was temporary and soon would right itself. Short sellers must believe that early signs of a recovery of bank and financial firm earnings will appear soon. They pulled out of these stocks late last month.
The short interest in Bank of America (NYSE: BAC), one of the most widely shorted stocks, dropped 2% to 152 million shares. Short interest in Citigroup (NYSE: C) fell 25% to 37.5 million. Shares short in Wells Fargo (NYSE: WFC) dropped 15% to 29.2 million. The short interest in Morgan Stanley, its stock badly battered over the past month, fell by 15% to 15.1 million.
The short action in tech shares was more mixed. The news was good for Dell (NASDAQ: DELL), which showed a drop in short interest of 9% to 63.2 million. Shares short in Intel (NASDAQ: INTC) declined 4% to 99.5 million. Shares short in Texas Instruments (NASDAQ: TXN) fell 10% to 15.7, despite the fact that it revised its sales forecasts lower. Shares sold short in Broadcom (NASDAQ: BRCM) dropped 15% to 7.9 million.
Short sellers increased their positions in Microsoft (NASDAQ: MSFT) by 10% to 61.5 million. The world’s largest software company has had mixed reactions to the release of its mobile OS on Nokia (NYSE: NOK) smartphones. Shares short in beleaguered Research In Motion (NASDAQ: RIMM) rose 6% to 59.2 million. The short interest in Amazon.com (NASDAQ: AMZN) was up 27% to 10.9 million.
Douglas A. McIntyre
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